QUADRENNIAL TECHNOLOGY REVIEW AN ASSESSMENT OF ENERGY TECHNOLOGIES AND RESEARCH OPPORTUNITIES Chapter 3: Enabling Modernization of the Electric Power System September 2015 3 Enabling Modernization of the Electric Power System Issues and RDD&D Opportunities Fundamental changes in electricity generation and use are requiring the electricity system to perform in ways for which it was not designed—requiring new capabilities and system designs to maintain historical levels of reliability. American industry and commerce demand affordable, high-quality power with high reliability to support an increasingly digital economy. As the nation’s critical services become more digital and automated, power disruptions have potentially greater consequences. Advanced technologies to plan, manage, monitor, and control electricity delivery are needed to enable safe and reliable two-way flow of electricity and information, support growing numbers of distributed energy resources, and support customers participating in electricity markets as both power suppliers and demand managers. Research, development, demonstration, and deployment opportunities exist to accomplish the following: - Develop and refine interoperable grid architectures and new system designs - Develop software and visualization tools that use new data from transmission and distribution system devices for enhanced, real-time operations and control - Research material innovations and develop transmission and distribution component designs for higher performance, reliability, and resilience - Embed intelligence, communication, and control capabilities into distributed energy resources and systems such as microgrids to support grid operations - Improve energy storage capabilities and systems designs that lower costs while increasing capacity and performance, and facilitating integration - Develop high-fidelity planning models, tools, and simulators and a common framework for modeling, including databases - Design innovative technologies and resilient and adaptive control systems to improve physical- and cyber-security of the grid Quadrennial Technology Review Enabling Modernization of the Electric 3 Power System 3.1 Introduction The electric power system is facing increasing stress due to fundamental changes in both supply and demand technologies. On the supply side, there is a shift from large synchronous generators to lighter-weight generators (e.g., gas-fired turbines) and variable resources (renewables). On the demand side, there is a growing number 3 of distributed and variable generation resources, as well as a shift from large induction motors to rapidly increasing use of electronic converters in buildings, industrial equipment, and consumer devices. The communications and control systems are also transitioning from analog systems to systems with increasing digital control and communications; from systems with a handful of control points at central stations to ones with potentially millions of control points. All the while, the system is being asked to perform in ways and in a context for which it was not designed. The result is a system that is under increasing stress from these and other factors and requires much greater flexibility, agility, and ability to dynamically optimize grid operations in time frames that are too fast for human operators. Fundamental advances in the power system are needed to address these changes and ensure system reliability. The Southwest Blackout in 2011, for example, was the result of a cascading failure that took place in seconds—too fast for human intervention. These fundamental changes, however, also open a set of opportunities that can be tapped to significantly improve performance, lower costs, and address our national energy challenges. The research needs that can help realize these opportunities are described in this chapter. The U.S. electric power system is the centerpiece of the nation’s energy economy. Of the roughly 97 quads (quadrillion British thermal unit) of energy used in the United States in 2014, about 38 quads were transformed into 3,900 terawatt-hours of electricity for delivery by an extensive infrastructure of more than 19,000 generators, 55,000 transmission substations, 642,000 miles of high-voltage lines, and 6.3 million miles of distribution lines to serve 145 million customers.1 Electricity generation accounts for the largest proportion of U.S. energy use: nearly all of the nation’s coal, nuclear, and non-biomass renewable sources consumed and one- third of natural gas sources (see Figure 3.1). The system is owned and operated by more than 3,000 utilities and is overseen by thousands of municipal, state, and federal officials. Virtually every aspect of American commerce and industry depends on the continuous availability of affordable electric power. Electricity use is projected to grow by 25% from 2013 to 2040.2 Although the rate of growth in electricity use will continue to slow—as it has since the 1950s, largely due to energy-efficiency improvements and a transition toward a service-based economy (moving away from heavy manufacturing)—the nation’s reliance on a reliable, efficient, and resilient power grid is rising. This dependency grows as businesses, homes, and communities increasingly integrate digital technologies and automated systems into nearly all aspects of modern life. This dependence is highlighted when widespread power interruptions affect whole communities and regions due to catastrophic natural disasters. 3 Enabling Modernization of the Electric Power System An increasing reliance on electricity presents significant challenges for utilities, state-level decision makers, and other stakeholders, who must improve reliability and resilience while cost-effectively managing the fundamental changes required to meet the needs of a low-carbon, digital economy. The electric power system is currently undergoing significant changes in the sources we rely on to generate electricity, the means by which we receive electricity, and even in the ways we consume electricity. Figure 3.1 Estimated U.S. Energy Use in 2014: ~98.3 Quads Credit: Lawrence Livermore National Laboratory Lawrence Livermore EstimatedEstimated U.S. U.S. EnergyEnergy UseUse in in 2014: 2014: ~98.3 ~98.3 Quads Quads National Laboratory Net Electricity Imports 0.164 Solar 0.170 0.427 8.33 12.4 25.8 Nuclear Electricity 8.37 8.33 Generation Rejected 2.44 38.4 Energy Hydro 16.4 59.4 2.47 4.12 1.73 4.79 Wind 1.73 0.159 Residential 0.252 11.8 7.66 0.0197 Geothermal 0.945 0.202 0.580 5.20 3.13 0.0197 4.63 Natural Commercial Gas 8.93 5.81 27.5 3.55 Energy 0.561 Services 0.0257 0.0470 38.9 4.95 3.26 0.119 Coal 9.46 Industrial 17.9 24.7 19.8 8.16 1.51 2.30 0.507 Biomass 21.4 4.78 1.27 0.0265 0.294 0.942 Trans- 24.8 portation 27.1 Petroleum 5.68 34.8 Source: LLNL 2015. Data is based on DOE/EIA-0035(2015-03), March, 2014. If this information or a reproduction of it is used, credit must be given to the Lawrence Livermore National Laboratory and the Department of Energy, under whose auspices the work was performed. Distributed electricity represents only retail electricity sales and does not include self-generation. EIA reports consumption of renewable resources (i.e., hydro, wind, geothermal and solar) for electricity in BTU-equivalent values by assuming a typical fossil fuel plant "heat rate." The efficiency of electricity production is calculated as the total retail electricity delivered divided by the primary energy input into electricity generation. End use efficiency is estimated as 65% for the residential and commercial sectors 80% for the industrial sector, and 21% for the transportation sector. Totals may not equal sum of components due to independent rounding. LLNL-MI-410527 Electricity generation accounts for a significant portion of annual U.S. energy use, including nearly all coal, nuclear, and non-biomass renewable sources, and nearly a third of natural gas. This chapter of the Quadrennial Technology Review (QTR) focuses on the research, development, demonstration, and deployment (RDD&D) needs to develop a modern electric power system. Yet, it is important to note that the reliable delivery of electricity also depends on the structure and dynamics of electricity markets as well as federal, state, and local policies and regulations. These issues are addressed in the 2015 Quadrennial Energy Review. 3.1.1 Modernization of the Electric Power System The U.S. electric power system has provided highly reliable electricity for more than a century, yet much of the current electric grid was designed and built decades ago using system design models and organizational principles that must be restructured to meet the needs of a low-carbon, digital economy. The traditional architecture was based on large-scale generation remotely located from consumers, hierarchical control structures with minimal feedback, limited energy storage, and passive loads. This traditional architecture is graphically illustrated in Figure 3.2. 54 Quadrennial Technology Review This traditional system was not designed to meet many emerging trends, such as greater adoption of relatively low inertia generation sources, growing penetration of distributed generation resources, and the need for greater resilience. As described in several recent studies, a modern grid must be more flexible, robust, and agile.3 It must have the ability to dynamically optimize grid operations and resources, rapidly detect and mitigate disturbances, integrate diverse generation sources (on both the supply